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| Vol. 4 No. 2 | Table of Contents MEIB Main Page | February 2002 |
Hichem Karoui is a writer and journalist living in Paris.
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The scandal dates back to 1987-1988, when then-Prime Minister Chirac and Interior Minister Charles Pasqua allegedly ordered the payment of $3 million to obtain the release of 5 French nationals held hostage by the Lebanese Shi'ite fundamentalist group Hezbollah.1 The ransom negotiations were reportedly brokered by Iskandar Safa, a wealthy Lebanese-born businessman.
The illicit ransom payments, apparently intended to bolster Chirac's chances of defeating the late François Mitterand in the 1988 presidential elections, remained a footnote in the sordid history of French counter-terrorism policy until last year, when France's domestic counter-intelligence service, Direction de la Surveillance du Territoire (DST), discovered a series of suspicious money transfers from Safa to bank accounts of individuals close to Pasqua. Details of the ensuing investigation leaked to the French media appear to indicate that a substantial portion of the ransom money was embezzled by Safa and funneled to former political allies of the French president.
Iskandar Safa
Iskandar Safa was born in Beirut in 1952 to a wealthy Maronite Christian family originally from Ghadir in north Lebanon. His father was a high-ranking civil servant in Lebanon during the French mandate. The family was reported to have made a fortune through construction contracts in Saudi Arabia.2 Iskandar was educated at the INSEAD international business school in Fontainebleau, France. After graduating, he made a fortune through a holding company, Triacorp, that he established with his brother Akram.
In 1982, Safa met Jean-Charles Marchiani, who then headed the Meridian chain of hotels. When Marchiani joined the Thomson group of French electronics companies the following year, he brought along Safa to help market French exports of "dual use" high tech products to Middle Eastern countries. Safa also worked for Sofremi, a company established by the French Interior Ministry which exports equipment used by police and security forces.
By the mid-1980s, Safa was travelling frequently in his private plane between Paris and various capitals of the Middle East, an important market for electronics, security and defense systems, and proved himself to be an excellent intermediary linking these companies to potential customers. In the process, he developed high-level contacts in the Arab world, Iran, and even Israel.
The Hostages
In 1986, Interior Minister Pasqua appointed Marchiani, a former SDECE agent,3 to oversee efforts to secure the release of French citizens taken hostage by Hezbollah in Lebanon. Marchiani, with full backing from Chirac and access to special funds (caisse noire) allocated to the prime minister for classified expenditures, turned to Safa.
Safa's precise role in the negotiations is not entirely clear, as there have been conflicting accounts by the participants. He himself has acknowledged some level of involvement in efforts to secure the hostages' release. "I accepted out of patriotism, as a Lebanese, and because it was a human problem also. I was horrified that some French citizens could thus be hijacked. Anyway, it was not for money," Safa later told Le Monde.4 He earlier confessed to the authors of a book entitled La Décennie Mitterand, Pierre Favier and Michel-Martin Rolland, "I put at their service my numerous contacts in Lebanon, in Syria and most of all in Iran."5
Other participants have said that Safa played a much more central role. One member of the team, speaking to a French newspaper on condition of anonymity, said that Safa was "undoubtedly the key man, who had his ways into all the communities (in the Middle East), Israel and the Mossad included." He added, "We were a dozen men, and everything was being planned from Triacorp, Safa's company. For reasons of discretion and flexibility, it was Triacorp that funded the whole plan. It worked as a front for the French government. Safa himself has funneled several dozen million francs."6
Marchiani has always maintained that the hostages were released due to the settlement of the Eurodif affair. In 1974, the Shah of Iran lent the French consortium Eurodif $1 billion to establish a uranium enrichment plant in Tricastin, France, giving it the right to purchase 10% of the enriched uranium fuel produced by Eurodif. The Islamic revolutionary government, which took power in 1979, canceled the deal and demanded that the money and accumulated interest be reimbursed. However, Eurodif refused to pay back the money.
According to Marchiani, he met with envoys from the Iranian Finance Ministry in April 1988 and settled the debt. However, one member of the negotiation team seeking the release of the hostages noted that France made only a partial payment and promised to settle the outstanding debt two years before the hostages were freed - but that this was the first, but not the only condition for their release.7 The issue was not fully settled until 1991, when Paris agreed to pay $1.8 billion to Tehran.
Although the Lebanese magazine Al-Shiraa reported in 1987 that $3 million had been paid for the hostages' release, an allegation that was widely reported in the French press, government officials categorically denied the claim.
Suspicious Transactions
In January 2001, a DST deputy director, Jean-Jacques Martini, sent a note to the head of the Parisian judiciary police, informing him that large sums of money had been transferred from bank accounts belonging to Safa to individuals close to Pasqua and Marchiani, now a member of the European parliament. "The source who is the origin of this information is convinced that the money . . . comes from the French hostages affair. It would be part of the ransom released by the government and retained by the negotiators - Marchiani and Safa," said the DST memorandum, which was published in full last month by Le Monde.8
Three days later, the judiciary police submitted a copy of the memo, along with 11 banking statements produced by the DST, to a government prosecutor, Jean-Pierre Dintilhac. Although it is standard procedure for the judiciary police to conduct its own inquiry prior to handing a file to a prosecutor, police officials immediately understood that this was not a routine criminal case, but a political bombshell implicating officials at the highest levels of the French government. Pasqua and Marchiani were both under investigation at the time in connection with the Falcone affair (commonly called "Angola-gate" in the French press), a major scandal involving the illicit sale to Angola of $500 million worth of Russian-made helicopters, tanks, and other military equipment in 1993-1994 by Pierre Falcone and his company, Brenco International. Pasqua, who approved the export licenses for the arms, benefited from large donations made by Falcone to his political party, Rassemblement pour la France (RPF), and to Association France Africa Orient (AFAO), an organization headed by Pasqua and his diplomatic advisor, Bernard Guillet. Marchiani received over $400,000 from Falcone.
The "source" mentioned in the DST memorandum may have been Manucher Ghorbanifar, an Iranian who was formerly an informer for the Direction Générale de la Sécurité Extérieure (DGSE). Ghorbanifar is said to have accompanied Marchiani during his meetings with the deputy Iranian foreign minister to negotiate the release of the hostages. According to one report, Ghorbanifar was promised a share of the proceeds and recently complained that he had not been fairly paid.9
Government prosecutors began a preliminary inquiry into the financial transfers discovered by the DST on January 23 and, five months later, launched a formal judicial investigation. The probe centered around the activities of Safa's chauffeur, Mohamed Al Sayes, and a second employee, Isam Abbas.
According to the DST and sources close to the financial brigade, a branch of the French police specializing in investigating financial transactions, over the last 10 years several million dollars were transferred from a Swiss bank account in Safa's name to the Champs-Elysées branch of the Crédit Commercial de France (CCF) and picked up at periodic intervals by Sayes. Abbas accompanied Sayes on these trips and divided the money into two separate envelopes. Sayes made regular trips to deliver the envelopes (around 300,000 francs per visit) to an aide of Pasqua, Marie-Danièle Faure, and Marchiani at the Association France-Orient (AFO), a successor to AFAO.10 Investigators have also discovered checks received by Marchiani that were drawn from another account of Safa at Crédit Lyonnais, which was abruptly closed after the investigation into Marchiani's role in the Falcone affair was launched.
Investigators have also discovered that a number of political allies and aides of Pasqua and Marchiani occupied offices owned by Safa on the boulevard de la Tour-Maubourg in Paris.
Sayes and Abbas were arrested in October and December 2001. According to French media reports, Sayes confessed to carrying envelopes, "containing wads of banknotes which I had previously counted before Mr. Safa," to the AFO office and personally delivering them, "often to Mrs. Marie-Danièle Faure and sometimes to Mr. Marchiani." Sayes also confessed to delivering envelopes to Marchiani at his residence and occasionally leaving them with his wife, Christiane.11
Another chauffeur of Safa, Raymond Issa, was interrogated by the police in December and confessed to delivering envelopes, marked "private and confidential," to Faure at the Interior Ministry between 1993 and 1995, prior to Pasqua's departure. On December 13, Francoise Fleur, a secretary in Safa's company, confessed to police that "the envelopes addressed to the Ministry of Interior were regularly delivered . . . from 1993 to 1995. The envelopes were enough large to contain several dozen thousand of francs." The money, she said, "was destined during all these years, from 1990 to the end of 2000, to Mr. Marchiani . . . they were often conveyed by Mrs. Faure to Mrs. Christiane Marchiani, and certainly to Mr. Charles Pasqua too." Asked why Mr. Safa was sending money to the people she mentioned, Fleur said that in her opinion these funds were used to "buy influence and to obtain some services from these politicians."12
On December 21, Faure, Marchiani and his wife were formally placed under investigation on charges of money laundering and trading favors. There have also been reports that Bernard Guillet, Pasqua's colleague at AFAO, has been put under investigation.
By this time, Safa had already left France on December 8, sensing, perhaps, that his luck was running out. After failing to respond to a police summons later that month, France issued an international arrest warrant against him. In January, his lawyer in Beirut said that Safa would return shortly to clear his name, but he remains abroad.
Conclusion
The question of whether the French government paid a ransom for the release of hostages has become a major headache for Chirac and Pasqua, both of whom are running against the incumbent prime minister, Socialist Lionel Jospin, in the presidential election in April. Christian Prouteau, who headed the anti-terrorist unit at the presidential palace under Mitterand, recently confirmed that ransom money was paid to Iran in exchange for the release of three hostages. Moreover, a former French ambassador to Tunisia, Eric Rouleau, has even alleged that Chirac intentionally sabotaged parallel talks with Iran by aides of President Mitterand, his rival in the 1988 elections.
Other former officials allied with Chirac continue to deny that any ransom was paid. A key Chirac aide at Matignon (1986-1988), Maurice Ulrich (presently an Elysée adviser) recently declared that the liberation of the hostages was never linked to "any ransom paid by the French state." Former Prime Minister Edouard Balladur, who was finance minister in Chirac's government, has likewise denied that any ransom was paid.
Although Chirac has not been directly implicated in the kickback scheme, this latest scandal, along with other cases still under investigation (some dating back to his tenure as mayor of Paris), may seriously impair his chances of winning a second mandate at the Elysée. Public support for Chirac is at the lowest level since he was elected president in May 1995. According to a January 10 public opinion poll conducted by the weekly Paris Match, only 11% of French citizens believe Chirac is "honest." Moreover, 25% affirmed that the French president is "hypocritical" and "a demagogue who frequently changes his opinions." The survey also predicted that Jospin would defeat Chirac in the presidential election.
Notes
1 Jean-Louis Normandin and Roger Auque were released on November 27, 1987. Marcel Fontaine, Marcel Carton and Jean-Paul Kauffmann were released on May 4, 1988.
2 Le Figaro, 3 January 2002.
3 The service de documentation extérieure et de contre-espionnage (SDECE) was changed under Mitterand to direction générale de la sécurité extérieure (DGSE).
4 Le Monde, 7 January 2002.
5 AFP, 7 February 2001.
6 Le Parisien, Quoted in Le Monde, 9 January 2002.
7 Ibid.
8 Le Monde, 7 January 2002.
9 Le Canard Enchaîné, Quoted in Le Nouvel Observateur, 8 January 2002.
10 Le Nouvel Observateur, 7 January 2002.
11 L'express 30 January 2002.
12 Le Monde, 4 February 2002.